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Wendy's hopes the third time will be the charm as it ramps up to compete in the growing arena of breakfast. The chain recently began testing a morning menu in three markets that includes toasted egg sandwiches, paninis and smoked bacon. Two previous tries were scrapped after the food took too long to make and didn't taste good, the company's chief marketing officer said.

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Sweet, fruity jams and preserves are taking a back seat to savory versions that can be used in many more applications than breakfast toast. Bacon, caramelized shallot and tomato are starring in their own jams and are livening up sandwiches, burgers and dips.

Wendy's reported higher-than-expected second-quarter earnings on Tuesday and said it will sell 425 of its restaurants to franchisees, taking its corporate ownership from 22% to 15%. The chain saw success with its new Pretzel Bacon Cheeseburger, but said systemwide same-store sales in North America rose only 0.4%, after some units stopped selling breakfast and the chain boosted marketing of its value menu.

Wendy's will keep breakfast on the menu at about 400 locations, but it has scrapped the morning meal at many restaurants and has no plans to expand it to new stores any time soon, CEO Emil Brolick said. The company took a $14.6 million charge to write off equipment at stores with lackluster breakfast sales.

Customers who order off the value menu at Wendy's typically also buy additional regular-menu items, the company says, a key reason for raising the profile of the lower-priced offerings. Wendy's recently scrapped its 99-cent menu in favor of a "Right Price Right Size" roster with products ranging from 99 cents to $1.99; the chain and rivals including McDonald's and Burger King have been tweaking their value menus to reflect higher food costs.